Skip to main content
1:00 pm
>> stick with the refiners. more "fast" at 5:00 p.m. tonight. one second away from apple's announcement on "power lunch." >> we interrupt our normally scheduled broadcast to bring you this important announcement. and we welcome you to power lurch. i'm sewer herrera. my partner today is simon at the nyse because tyler's on assignment today. >> the big day is finally here. if you own an apple product, if your family buys apple products, if you own the stock, are considering owning the stock or if you own a mutual fund, and who doesn't, be with us for the full hour as apple now shows off its new product line. >> highly anticipated, certainly, that's an understatement. that's why we have brian
1:01 pm
sullivan outside the conference hall in san francisco. we have a very sophisticated system designed to bring you the latest news and pictures as they happen. so brian, what are we expecting? >> this is going to be a big time event here. maybe we need a giant sledgehammer to smash a screen a la 1984. here's how this is going to work. this is why i walked all the way out here last night. lights just dimmed. al gore seen, we are ready to go. we have a full crew here. jon is going to be sending us information as it occurs. he is going to deliver that information via electronic message to me, and then i will use that to deliver it to you and our audience to make sure that cnbc viewers get all the latest on apple. the expected iphone 5, maybe an ipad mini. maybe maybe great e facebook integration, ios6, whatever. that will be fed from there to
1:02 pm
me from me to you. watch facebook, maybe greater integration, google. will youtube get the boot in the apple screen? lot of talk there. and the shares up .4%. this is going to be an exciting day. i love the open, love the music. i'm ready to go. are you guys ready to go? >> oh, yeah! you bet we are. >> let's bring in business insiders henry blodgett. it is going to be about the things brian mentioned but also about the earbuds. >> that's right. and this they have a new cord and people are either ecstatic about the new cord because it is going to be faster or they are incredibly annoyed because they spent the last five years building a household supply of the old cords and those are going to be obsolete. yes, there will definitely be a lot of surprises. but the key for the stock and for the company is the iphone.
1:03 pm
we seem to have pretty good expectations as to what it is, so be very interesting to see whether it is a surprise. >> henry, stay with us. we've got the bond results. yesterday we had an a-minus, three-year auction. rick santelli is here with a grade on the ten-year. >> it is going to have to simmer in my brain while i give you all the specifics. first this is a nine year 11 month auction. issuance we started last month. indirect average 42%. this was light at 36 and change. we take a grade off right away for the bid to cover on the light side. priced through right into new wi
1:04 pm
highs. this gets a c-plus for the ten-year note auction. >> yikes. on a day when the fed is meeting. rick santelli, thank you very much. let's bring in all things digital peter copka into the conversation. stakes are very high for apple because the landscape is different than when it released its earlier versions. it is a more crowded market certainly and the iphone accounts for an enormous amount of apple's bottom line. they really have to deliver something that's spectacular. >> the iphone drives apple in many ways. apple did not have this territory to itself when it started. remember a company called blackberry, rim, they still exist. a company called palm that doesn't exist anymore. apple came in and dominated that right away. for a couple years they had the market to themselves. obviously now they are fighting off android and google both in court and on the market. last year we expected to see an
1:05 pm
iphone 5 at this time. we got an iphone 4s instead. that didn't preview maybe as well as apple would have like. now is the chance to get it right this time around. >> steve cook is on the stage. henry, before we get into the announcements that they are make, there is a backdrop here about which you have been tweeting on working conditions within apple's factories that may not be ideal. do you think shareholders just ignore that with the barrage of news that is about to come through? >> i think certainly today they will ignore it and they should. this is tremendously exciting. i definitely think it is an issue that's going to become more and more widespread and talked about over the next six months to a year. what we got today was report ostensibly by a shanghai reporter who went in and worked for apple for a week -- or foxcon, they make the iphone 5. it just described just horrible
1:06 pm
working conditions. not exploit ative terribly, just so boring, terribly underpaid, physically demanding. but no, i don't think shareholders will care today. >> henry, i put the question to peter, to you as well -- the low hanging fruit in this mobile market has really been taken by either apple or samsung. so it is a more crowded market as apple introduces this new device. do you think they have the clout in a crowded market to get people to upgrade to this device, perhaps if they are not at the end of their contract? doesn't it have to be incredibly compelling given the amount of the percentage of its bottom line that they rely on for iphone sales? >> i think it is an incredibly important point and it is a crowded market in a different way than it was five years ago which is now the u.s. smartphone market, for example, is more than half penetrated. as we go for further penetration, the growth rate of the market is going to slow down and you also have people who are
1:07 pm
buying it, yet to buy it, have much less money than the early adopters. so it is going to become a different kind of market. big opportunity sinsly which is still much less penetrated than the united states. there is a big opportunity. >> to that point i can tell you foreign policy jon fortt who is inside there, tim cook is showing a video of the barcelona store opening now saying they have 380 stores in 12 countries, 13th country sweden is coming. 1 million people around the world using apple's products. peter, apart from the iphone 5, what else will move the stock here? >> be interesting to see if there's anything along the lines of -- well, we know they'll talk about a facebook integration. we don't expect to hear much about music and tv and movies. if there is much there, that will be an interesting surprise as well.
1:08 pm
john barr, you've clearly got skin in the game. let me tell you now, more news coming from tim cook. he's talking about the recent mac updates, including mountain lion. he says apple notebook is now number one in market share in the united states over the last three months at 27%. that probably won't surprise you. what do you want to hear, here on in? >> we've been long term investors in apple due to their ability to generate great new products. there are two things that i'm focused on here that i think are important. first is just their support of lte as the next generation network of verizon, at&t and sprint. and how that will help mobile data, will help mobile video and be very important for many other companies beyond apple. and the second is that one of the chips in here will support the wireless standard in china which will provide opportunities
1:09 pm
for apple to sell the iphone in to china mobile some time in the future. >> how concerned are you about the intervention of the chinese government and the degree to which they could slow what is clearly an iconic american company's growth in their own backyard? because there's been a lot of comments about that as well, john. >> well, for apple, they have not had an agreement with china mobile and we would think that there will be one some time in the next year. >> peer, that's kind of a back door way in to china, but a lot of people think that if indeed that is the case, if they do announce that kind of initiative, it perhaps is a more effective way to penetrate the biggest market in the world rather than going in perhaps in a more overt way. they already have, to a certain extent. but how effective do you think that kind of initiative might be? >> i'm going to defer on this one. if you want to ask me about the chinese market, you're better off asking just about anybody else on tv right now.
1:10 pm
>> okay. henry? >> it is a huge market. just that one simple phone company dwarfs the entire united states market. no question massive opportunity and no question investors are looking to that. john would be the best to address it. >> john, do you want to pick up on that? >> i just say, if they have included the qualcomm chip, which it appears they have, then the opportunity will be there to work with china mobile in the future. >> gentlemen, stand by. let's take you back to san francisco and to brian who's standing outside that apple conference. >> reporter: simon, i may be outside but we're going to show you some of the first video from inside here as we're going to do all hour long until this event concludes. tim cook taking the stage, saying basically retail has been booming. they announced their 1th coun3t country, sweden, will be opening up. they talked about their laptops being basically number one in market share in the past three
1:11 pm
months. we've talked a lot about the pc cycle really coming down, guys. well, tim cook actually touting how well the new mac book line has sold. number one in market share over the past three months. that is moments ago. we're going to do this all hour, guys. bring out video for you first on cnbc. we are taking you from out here to in there and i will send it back to you on the east coast. >> thanks, brian. we're talking about how to play apple. jim, you did hold some apple. you don't anymore. why? and would you add to it today? >> if i had to make a trade, i'd rather go into this long. but here's my concern. the question's just going to be how many people are bowled up on this event looking for a pop to sell it. the initial reaction might be a sale if there's even the slightest bit of disappointment with the launch. what i ro rather do is wait to see how the market digests this. from a longer term technical standpoint, the apple chart looks very good especially if it stays above those april highs.
1:12 pm
in the next three days we'll know the reaction quite clearly. not just the initial reaction. then i would take a very serious look at apple. >> thank you, jim. john barr, if i could go back to you very quickly -- well, he'll be back with us in a few minutes. the finance poll today, as apple unveils a new line, will you make apple investment decisions based on that release or not? which was basically the question i was going to put to john barr. results are coming up. as if that wasn't exciting enough, we are following a breaking story regarding two airline giants. phil lebeau has that. >> we're taking a look at the report of airbus parent eads in discussions with british aerospace, bae systems, about a possible combination of the two companies. you mentioned airline giant. really when you look at these two charts and this possible combination, you have to focus on the defense side. that's really where implications will be strongest. the terms of the deal, it is
1:13 pm
still in discussion. it remains to be seen what happens here. could be where eads has 60% of the stock. bae system, their shareholders have 40% of the company. but the thing to focus on here is the reaction from boeing, lockheed martin, general dynamics. those guys are the powerhouse defense companies that would face the biggest implications if eads and bae got together. as we take a look at these shares, that's the area to focus on and whether or not this would meet approval here in the united states. >> those are absolutely huge questions. it is clear that eads is regarded as the acquirer of bae if you look at the stock price. coming up ahead on "power lunch," the difference between what wall street wants in november and what they think they're going to get. plus, more on apple live from san francisco. brian sullivan is in the thick of it, so to speak. brian? >> reporter: it really is, guys.
1:14 pm
simon, i want to bring you a couple of data points. 400 million ios devices sold now as of last month. 400 million. 17 million ipads sold between april and june. tim cook, the ceo, taking a swipe at the competitors saying, we've got 91% web browser market share on our tablet, "i don't know what those other tablets are doing." so take a little bit of a hard shot there. i'm going to leave you with this. tim cook just saying on stage, we've got big news coming about the iphone. how's that for a tease? back with more "power lunch" from san fran and new york right after this.
1:15 pm
1:16 pm
1:17 pm
i'm brian sullivan outside the apple event. we have details on the iphone 5. you've got basically five icons down. it is a bigger phone. there will now be six. still four across, six down. we know that the new iphone 5 is going to be larger than the iphone 4 and 4s. it is 18% thinner, 30% lighter. 20% -- there you go. so it is going to be lighter, thinner, but it is going to have a bigger screen. six icons down, four across. when they revealed it, guys, it
1:18 pm
came up out of the floor on a pedestal. we are going to bring you more breaking news on the new iphone 5 as it happens. bigger, thinner, lighter, and likely with a longer battery. stay tuned. >> can't wait to see that. thanks, brian. peter, your reaction. is it what you expected? >> well, yeah. the internet got this right. we've seen pictures of a version of this for a month or more now. this is one of the cases where you can trust what you read on the internet. the iphone is getting bigger and we believe the ipad will get smaller next month. interesting. >> john, you hold the stock. what would you do? let me put that to henry. >> so far it is almost exactly as expected, as peter said. i'm not surprised to see the stock trading off. some chance that they would surprise and a lot of people, frankly, have been disappointed with what we've been seeing --
1:19 pm
>> hang on. they've only got the look of it yet. we don't know what else it might do. i remember when the 4s came through and a lot of people were disappointed initially until they realized the value of siri. >> i think many people were disappointed with siri when they saw it used in the real world as opposed to the advertisements and demonstration. it will certainly be faster, hopefully the battery is longer. the point i would make is that this is a gradual improvement. it is a little bit bigger, little faster, little thinner. it is not the radical innovation that sue was alluding to earlier that would make everybody rush to the store and say i'm going to fork over $600 to get the new phone. >> the stock off .5% on the trading session, 657.26. >> we'll see the stock sell around, bump around, it does
1:20 pm
always does with apple. when they talk about e-commerce amounts, other features besides just the look of the phone will make a big difference and how you actually use the phone in the real world. >> wow, tough crowd. as we get more news on that we will bring it to you live from brian. there seems to be a major disconnect meanwhile between what wall street wants this election in november and what they think they're going to get. senior economic reporters steve leisman is here with the results of cnbc's exclusive fed survey. >> simon, i was very surprised by these results. we threw this question in to gauge wall street's sentiment, figure out what they were preparing for when it came to the november election. we asked two questions -- who do you think will win the election? that was 46%-24%, that's about 2-1. then who do you want to win? 53%-18%.
1:21 pm
call that 5-2. pretty big percentage saying they don't know right now or are unsure. are americans better off than they were four years ago? only 40% of our 58% of respondents said yes. 49% saying no. what would ben bernanke do if mitt romney won the white house an we said would bernanke resign? 80% said no, he would not. 7% said yes. asked about the bigger political question of the fiscal cliff, 74% say it is already hurting the economy. 15% say it is going to affect later. 11% saying no effect at all. check out these concerns from ethan harris of bank of america. "the u.s. and global economy are entering the most dangerous period of this economic recovery. if the fiscal cliff is badly handled at the same time that the european crisis enters another acute phase, a recession is likely." sue, those are concerns about political issues that are out there among wall street
1:22 pm
veterans, waumt economill strees and strategists. we'll have interesting data on the european crisis at 2:00. we know it is thinner, we know it is lighter. maybe it will fit in a cocktail purse. brian sullivan has the first pictures of the new iphone. >> we do. video moments ago of the new iphone 5 being unveiled. we gave you some of the specs. bottom line, they released it, it is bigger, it is thinner, it is lighter. you've got now six rows basically of icons. they're going to make sure that your old apps do work on the new phone. but there is video. the room basically went dark and they had this phone come out with a light on it. that's what we're looking at right now. pretty cool stuff here. there is a lot of technical stuff we're hearing about the iphone now. for example, 44% more color
1:23 pm
saturation. you can see it is a longer screen and the key now for folks for apps, maybe the zyngas of the world, the open tables of the world, they did show open table's app -- that real estate, extra real estate, guys, is going to add functionality, perhaps, sue, as you and simon know, the key -- mobile ads. that's everything now for facebook, will they use that real estate for ads. that could be a big game changer for some of these struggling companies figuring out how to monetize the new stuff on our phones. >> the stock has pulled almost unchanged on the trading session. special edition of analyze this focusing on two stocks. one of them apple, the other facebook. speaking of facebook, much more on mark zuckerberg's first public comments since the company went public in may. >> personally, this is maybe a perverse thing personally, but i would rather be in the cycle where people underestimate us because i just personally would rather be understatemented. i think it gives us good
1:24 pm
latitude to go out an take some big bets and do some things that really excite and amaze people. exclusive to the military, and commitment is not limited to one's military oath. the same set of values that drive our nation's military are the ones we used to build usaa bank. with our award winning apps that allow you to transfer funds, pay bills or manage your finances anywhere, anytime. so that wherever your duty takes you, usaa bank goes with you. visit us online to learn what makes our bank so different.
1:25 pm
1:26 pm
time to analyze. tjm institutional services, a contributor contributor. only talking apple and facebook for obvious reasons. jeffrey is giving its take on found bake founder mark zuckerberg's comments from
1:27 pm
yesterday's user's forum. >> i agree with this completely. i like that they not just might go into the search business and be profitable in that, for me it is like why i didn't play facebook before is that it is difficult to gauge its relevance going forward. perhaps this number searches per day would be one of those things you could put in the bag -- >> they have a $30 price target on this stock, up 7% today. >> that's fine with me. i did some options today which is a synthetic long this stock as well. 30 seems like a very reasonable one to me. >> moving on, bernstein publishing a report on how much of a threat apple really is to google. bernstein thinks that the threat is "likely similar than first meets the eye." in terms of returning value, apple right now is up just a fraction on the trading day at $660 but it is up 73% year to
1:28 pm
date. what do you think? >> i think apple and google can compete quite comfortably in this space. kind of reminds me about mac versus pc for so long. i don't know that anyone else can. in bernstein's letter today, they say what if apple drops google as their default search engine? what if. they also said it wouldn't be a big deal so they are creating a situation that's not really happened, then saying it's not a big deal. >> they have a conviction buy. >> i agree, i just didn't like the wording. >> they have an $850 price target. >> okay. sounds a little lofty but okay. we're waiting on more big news from apple from san francisco. brian's out there. few minutes ago we got our first look at the new iphone 5. there it is, thinner and lighter. we are waiting on the price and release date. that's all straight ahead. and check out ea. it is popping based on something just said at the apple conference. it's up .5% at $13.87. we'll tell you why when "power lunch" returns.
1:29 pm
♪ ♪ ♪ [ male announcer ] introducing a look twice. introducing a stunning work of technology -- the entirely new lexus es. and the first-ever es hybrid.
1:30 pm
this is the pursuit of perfection. oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking. you know, i'm glad we're both running a nice, clean race. no need to get nasty. here's your "honk if you had an affair with taylor" yard sign. looks good. [ male announcer ] fedex office. now save 50% on banners.
1:31 pm
i'm sharon epperson at the nymex. gold close right now where they
1:32 pm
closed yesterday, $1,733 an ounce. the germ an constitutional cour approved the esm package as expected. now we are waiting to see what happens with the federal reserve. little profit taking in silver after its gains this month have doubled even what we've seen in the gold market. the key is going to be what happens in terms of what they say about any quantitative easing and actually how it is doled out. that's going to determine where prices go. we've seen prices gain in the gold market about $60 just this month alone. a lot of it perhaps has already been priced in, the fact that we may see more quantitative easing. we'll see with the open interest and volume whether it is all setting up for a big washout if the fed disappointments. the biggest company in the world is unveiling details of the product that drives 70% of its revenue. you bet we're across apple and the launch of the new iphone 5. brian sullivan is live in san
1:33 pm
francisco with our team on the ground with the latest. brian. >> probably the biggest complaint about the iphone is the battery life and apple going right after that. just moments ago announcing that it will have eight hours of 3g talk, ten hours of web time or app use. they are extending the battery life of the iphone 5. they also unveiled this will be a 4g lte phone. that simply means it is going to be a lot faster if you're surfing your web browser, if you're on apps, you'll be able to get video and app updates a lot faster. you got to watch verizon and at&t and sprint for that because they make a lot of money on those data plans as well. and also ea. electronic arts, the video game company, executive for ea was up on the stage showing off a new game for the iphone. with the retina display and
1:34 pm
colors, it is what they call "full console" quality. in other words you'll get the same game experience on your phone as you might sitting in front of your 60-inch flat panel at home. you see the spike for ea the minute the executive took the stage. that is why we're here. a lot of new companies could be unveiled in this iphone 5 unveiling. we're all set to go. we'll give you more as it happens first on cnbc. >> interesting that apple stock isn't making headway. expectations really high. let's check on the broader market. bob pisani is here, 25 up on the dow. >> we moved in the middle of the night, s&p futures moved up seven points as we got confirmation the germ an constitutional court upholding the eu bailout package. what's what's moving things. financials, industrial, energy, all positive on the day. materials just went to the
1:35 pm
negative side but they have been positive throughout the day. front running the fed as we see these high-yield bond fund continue to attract big volume remarkably because they are at new highs which means the yields that you get from these are not as much as they used to be a short while ago. these are people believing the fed will extend the low interest rates into 2015. that will make these high yield bond funds more attractive. electronic arts might be moving on the apple news. most of the companies that have components in the apple aren't really doing too much at the 1:00 p.m. announcement. the fed is in day one of its two-day meeting. the chairman widely expected to a new round of easing. chief u.s. equity strategist at ubs joins us. that is the question -- qe is either factored in to the market or not factored in to the market
1:36 pm
yet. >> there is a lot of expectation factor. if the fed doesn't come out with something like a half a trillion ondollars of qe, the market gets hurt. real question for me -- is this a trade or investment theme. i think this is a trade. i think if they give you a big number, i think the market rally extends but ultimately i think it rolls over because i done think it is great policy but the market's going to like it in the short run. >> you think the fiscal cliff issue is perhaps looming larger an much more important to the market than what the fed does near term. >> i'm not sure it is looming larger as much as it should be yet. i do think that once we get past the election. no one's talking about the fiscal cliff until we know who the next president is. then we realize we have major deficit problems that need to be aggressed and that will be a much more difficult debate. you saw what happened last summer on the debt ceiling and it wasn't pretty. >> the fed may be easier -- at least they are expected to extend out the low interest rate environment to 2015.
1:37 pm
so what sectors do you think on a longer term basis provide some value? >> first we have a $13.75 which means we actually expect the market to be something like 4% lower at the end of the year than today. but there are select spaces. one we are obviously hearing about, apple today, but we like technology stocks. why in a slow growing company you want companies that can deliver growth even if the underlying growth of the economy is not there. no group does that better than technology. energy, you saw the headline in the paper today, concerns about iran. that pushes oil prices up, even though commodities aren't necessarily supported by the broader economy. energy ends up being a winning story on that as well. if you want to play it safe, and you're cautious, i think you want to do in staples and health care, i think health care is the safe play going forward. >> what about materials? china seems to be slowing a
1:38 pm
little bit. but on the other hand they're now putting in infrastructure plays and that's been moving the material stocks. is that move largely over or is there move to go? >> i think there may be more to do. the material sector is very sensitive to what goes on obviously with the fed and monetary easing and the like. ubs put a big call on materials just on friday because if the fed moves, you saw the ecb move, you do get a movement up in materials, it is kind of an inflation play as compared to an economic growth story. but i think that's another area to watch. i agree with your call on that. >> what about high-yield corporates? >> i'm an equity guy. >> i know you are but i got to put that out there. >> i kind of like corporate credit. the reason is that companies are just so well run today. they have so much cash on their balance sheet. they're able to cover any interest expenses so easily, they're so underlevered that you would think in general, it should still be a good environment for corporate bond. it's hard for me to make a read, is it investment grade, is it
1:39 pm
high-yield. but in general corporate debt is still -- >> look at that. i got the equity guy to talk about the bond market. now to our own look at innovative investing and the surprising new study on where businesses are flourishing. on a day like today obviously there is a lot of attention on technology hotspots but it is high-growth companies in general, not necessarily technology, that may be powering regional economies. it is a first on cnbc. kaufman foundation crunched the numbers on 30 years worth of "i thch"i "inc"'s study of metrics over the last ten years. the greatest number of "inc." 500 firms. 385 to be exactly.
1:40 pm
followed up by salt lake city. the report finds cities like indianapolis and buffalo also in the top 20. the court's conclusion -- innovation comes from all corners of the country regardless of region and sector. but sue, i imagine some people thought that anyway. back to you. >> i think so. speaking of innovation, let's go back out to san francisco with brian sullivan. brian? >> reporter: sue, thank you very much. just getting details on what we expected. the new connecter. in other words, this thing where you plug your iphone in to charge it in to your computer, whatever it might be, that is indeed changing. it is going to be much, much smaller. ostensibly to have more room for the battery. we talked about that longer battery life. we are getting a change in the connecting plug on the iphone 5. also talking about the camera, 38 mega pixels. much better low-light resolution. changes in the camera. more microphones. now three on the phone.
1:41 pm
the big thing for me is that connecter. i know there is a lot of hype around the phone. it is likely going to be a big hit like almost every other apple product. but you know as well as i do, those connectors aren't cheap. you probably, like i do, have a number of them around your house. well, guess what? go out and buy about six more. good for component stores, i suspect. >> hang on. they come free with the phone. you get them when you buy the iphone. >> one's not enough! you have one charger for your iphone? there's no one you just have one. >> tough crowd. >> simon, i call you under/over, you have at least five chaernlgs. chargers. >> i actually bought the new mac book pro and it also has smaller connectors. >> we'll have a giant funeral p pire of all the old chargers. >> i can't even fathom how many
1:42 pm
devices i have to purchase. apple now trading on the up side by almost a full percent. facebook soaring 8% on the trading session. most of that after mark zuckerberg's first public comments since he took his company public. >> i just want to build good stuff. when you look at 10, 20 years from now the legacy of this company should be that we've connected everyone in the world and everyone can share all the stuff that they want and that's a lot. that's a lot to get excited about, whether it's fun exciting, whatever. some days are hard, some days kick ass but i think everyone is amped for what they're doing. >> but can they stay amped? heating oil, the only commodity on the up side b by .66%. [ male announcer ] when a major hospital
1:43 pm
wanted to provide better employee benefits while balancing the company's bottom line, their very first word was... [ to the tune of "lullaby and good night" ] ♪ af-lac ♪ aflac [ male announcer ] find out more at... [ duck ] aflac! [ male announcer ] [ yawning sound ]
1:44 pm
[ male announcer ] i've been a superintendent for 30 some years at many different park service units across the united states. the only time i've ever had a break is when i was on maternity leave. i have retired from doing this one thing that i loved. now, i'm going to be able to have the time to explore something different. it's like another chapter.
1:45 pm
coming up on street signs at the top of the hour, sully is live at the apple event, he's going to be co-hosting from there. we'll check back with him and find out what's happening. we'll also find out if apple has any other big guns in the pipeline. plus, new unrest in the middle east and with 55 days until the election, is this going to be a new catalyst for $100 oil? and higher gas prices. lots of questions, hopefully we'll get some answers on the show. >> thank you, very much. the finance poll this morning is as apple unveils a new lineup today, will you make an apple investment decision based on the release of the information that we are
1:46 pm
bringing you? the vast majority of you say no. it's still good fun though, don't you think? let's get back with brian sullivan. they continue to demonstrate, i understand, the advantages of a new, bigger iphone 5. >> yeah, they certainly do. they were justdy playing basically the turn by turn directions on the iphone 5. showing the new screen is going to be half an inch larger than the old screen which is about 3 1/2 inches. they're saying you can do a lot more. they're basically making the case why this is a major change to the iphone from the 4 and 4s. they're also talking about a photo sharing feature. you want to look at sfly. in our previous conversation, we talked about the connecter. apple did say they are making accessories to help with the transition. what that be means, i don't
1:47 pm
know. >> means you have to buy more stuff! >> they're not cheap though! i'm making a serious point. >> it is a company. it is a business. they're trying to sell you stuff. >> are you saying that the american economy is based on exchange money for goods and services, simon? how dare you. >> i'm afraid so. let's bring in peter and henry. henry, are you moved by what you're hearing now? >> there are two surprises. the first surprise is that there have been no surprises thus far, that the market pretty much nailed it. the second surprise is, maybe because apple chose to do the iphone first, they've got some big surprise at the end. i think people are still now waiting to see why did they do iphone first? maybe there's something good coming. >> we were surprised as well. a lot of times you see the smaller things or not less important but certainly the second tier items announced by
1:48 pm
apple -- >> they brought the phone out rye away. >> what does that mean to you? >> if you're waiting for one next thing you might be disappointed because apple has not given you that every time out. not every time when steve jobs came out, not every time when tim cook came out. in terms of the phone, i'm not very concerned about the connecter. i think we can all afford the $15. what's more significant for the iphone users, the data bills when they use all these fancy graphic, motion, faster speeds, they're going to pay for that. it used to be you pay for your phone and had all of your data. you'll pay for it bit by bit. it will be much more significant. >> one thing apple is good at is making people pay more for extra money. do you see a greater possibility here from what you're hearing for them to do with and really
1:49 pm
ride higher margins? >> the iphone is already tremendously profitable. expectations aside, this is a nice upgrade. bigger screen, lots of the things that we talked about. people will definitely want this phone. they will definitely pay whatever the highest price is for the phone. so this will be a big seller whether -- people are actually going to spend more for additional memory? we'll see. a lot of that depend on the apps and other things. >> stay with us, guys. headlines are coming in still on that apple event. we don't want to lose track of another tech titan. that is facebook. the shares right now are up just under 8% after mark zuckerberg finally sat down to answer some questions for the first time since the company's troubled ipo. for weeks now, people have been clamoring to hear from him and now they have. >> went public on may 18th and the stock has lost roughly half its value since then.
1:50 pm
>> just get right into it. >> if you could have done anything differently with hindsight, would you have? >> well, i mean the performance of the stock has obviously been disappointing. >> all right. back to our panel. henry, i'm going to start with you. this is the first time we've heard from mr. blodgett. that was just one piece. he's been poised, perhaps he's been mentored by some media experts. what did you think of his address and did it change your opinion? >> he was very well prepared obviously. knew what questions he was going to get. i thought he did a tremendous job. i think one thing he had to do was busineasically say to shareholders, look, we feel your pain. it's been disappointing. the other thing he did very well without getting into real specifics is dangle two huge businesses in front of the market. one is mobile. he's saying, look, i think
1:51 pm
mobile can be bigger than desktop for us. that's very exciting because everybody thinks that's killing the company, that transition. the second one, he said search is a huge opportunity. everybody knows how much money google makes in search. for him to say that, very encouraging. >> peter, more importantly perhaps, this is still an officer of a company that's worth, in broad terms, $50 billion. i know it's lost $50 billion but it is still broadly worth that. when the ceo of a company like that says that people thud think about doubling down, he doesn't want to look a fool, peter, does he, further down the line. if he said something like that and he knows what hindsight might look like, surely that's an indication that there is stuff coming that is going to propel that stock higher in the view of the guy. >> it would be tremendous news if mark zuckerberg said please don't buy my company we're headed for the fall. of course he's going to say double down. i think he's got to show confidence. if he said anything else it would be a tremendous blow for
1:52 pm
facebook. not surprised by that at all. >> all right, gentlemen. we really appreciate your being with us today. thank you so much. we're going to take a quick break. as you know, apple is the story of the hour. up next, the apple executive who just bought this absolutely stunningly beautiful home in a stunningly beautiful part of the world. we'll take you inside when we come back. i don't have to use gas. i am probably going to the gas station about once a month. drive around town all the time doing errands and never ever have to fill up gas in the city. i very rarely put gas in my chevy volt. last time i was at a gas station was about...i would say... two months ago. the last time i went to the gas station must have been about three months ago. i go to the gas station such a small amount that i forget how to put gas in my car. ♪ i was downstairs making coffee, and we heard it. it just came crashing through the roof, out of nowhere.
1:53 pm
what is it? it's our ira. any idea what coulda caused this? maybe. i just sorta threw a little money here, a little money there. and i loaded up on something my dentist told me was hot. yeah. ♪ boring. boring. [ jack ] after lauren broke up with me, i went to the citi private pass page and decided to be...not boring. that's how i met marilyn... giada... really good. yes! [ jack ] ...and alicia. ♪ this girl is on fire [ male announcer ] use any citi card to get the benefits of private pass. more concerts, more events, more experiences. [ jack ] hey, who's boring now? [ male announcer ] get more access with the citi card. [ crowd cheering, mouse clicks ]
1:54 pm
1:55 pm
welcome back to "power lunch." breaking news -- abercrombie & fitch has retained goldman sachs as an advisor in the face of continued pressure from relational investors. as of the second quarter, relation and reported an increased stake of 3.8% in the struggling retailer which tapped goldman to field suggestions from the activist investor. some those suggestions have been evidenced in abercrombie's plans to cut expenditures for the rest of the year. stock has lost 45% of its value in the last year. abercrombie has pointed to weakness in europe during its continued downturn. one large reason for the stock's underperformance but the stock has rebounded much as european concerns are mitigated. at this point it is unclear how
1:56 pm
much pressure relationals ralph whitworth will put on the company. shares continue to see weakness. abercrombie declined to comment, as did goldman sax. >> the stock was negative, then it moved to positive on kayla's report. it's turned back into the red. we're back in just about a minute with the final update from the apple event.
1:57 pm
a passionate belief, and the foundation on which merrill lynch has been built. today, our financial advisors lead from a new position of strength. together with bank of america, they have access to more resources than ever before. a steadfast commitment to help you achieve your financial goals in life.
1:58 pm
that's the power of the right advisor. that's merrill lynch. oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking. you know, i'm glad we're both running a nice, clean race. no need to get nasty. here's your "honk if you had an affair with taylor" yard sign. looks good. [ male announcer ] fedex office. now save 50% on banners.
1:59 pm
before we return you to san francisco and more details of apple's new lineup, we wanted to show you how one of its top executives is spending some of his money. jonathan ive is apple's head of industrial design and the man credited for the sleek design of the ipod and iphone. ive recently shelled out $17 million for mansion in san francisco. 1927 hill top residence overlooks the golden gate bridge and alcatraz featuring we're told stunning views of the city. according to the "wall street journal," the home was originally listed at $25 million. ive is on his feet. more details on what exactly he's saying on the

Power Lunch
CNBC September 12, 2012 1:00pm-2:00pm EDT

News/Business. Today's news on the economy, markets, real estate, media and technology. New. (CC)

TOPIC FREQUENCY Apple 13, Us 9, San Francisco 8, Brian Sullivan 7, China 6, Abercrombie 3, Bernstein 3, U.s. 3, John Barr 3, Simon 3, Mark Zuckerberg 3, United States 3, Citi 3, Google 3, Facebook 3, Bae 3, Ea 2, America 2, At&t 2, Cnbc 2
Network CNBC
Duration 01:00:00
Scanned in San Francisco, CA, USA
Source Comcast Cable
Tuner Virtual Ch. 58 (CNBC)
Video Codec mpeg2video
Audio Cocec ac3
Pixel width 528
Pixel height 480
Sponsor Internet Archive
Audio/Visual sound, color

disc Borrow a DVD of this show
info Stream Only
Uploaded by
TV Archive
on 9/12/2012